1-2 The Economy and Your Education Learning Goals: -Describe how the economy can affect prices and income -Discuss the costs of and options for higher education and post-secondary training - Explain how to pay for college and other education programs

Bell Ringer  Write down at least one question you have about colleges, costs of education, or how will you pay for education.

What is the Economy?  The economy is the activity going on in the marketplace at one point in time. The economy sets prices and determines how resources will be used.

Supply and Demand within a Market Economy  A market economy sets prices based on supply and demand.  What is supply?  The quantity of goods and services that producers are willing and able to provide  What is demand?  The willingness and ability of consumers to buy goods and services  As consumers act in self-interest behavior, they create demand for good and services. Businesses are willing to provide those goods for a profit. These two forces work together to create an equilibrium price.

How the Ecomony Affects Income  What do you hear or read in the media?  A growing economy means people are working and spending money. People get raises and can more easily find a job.  How did the Great Depression affect people’s buying habits long after the depression was over?

What is the business cycle and how does it affect you as an individual?  The business cycle is the alternating periods of growth and decline in the economy.  The business cycle is the recurring ups and downs of the economy, consisting of recovery (growth), peak, recession (decline), and trough.  During economic growth, people are optimistic; new jobs are being created; it seems logical to spend money.  Prices decline during a recession, so if you have the cash to spend, you can find the best values.

Cost of Education: How is tuition different than fees?  Tuition represents the expense for classes and instruction.  Fees represent costs associated with programs and technology.  Money is also needed for living expenses such as food, rent, clothing, and transportation.

Public vs. Private Colleges and Universities  Typically, public colleges and universities are less expensive.  Likely to find smaller classes and more personalized attention at a private college.  Make sure institution is accredited – certified to meet educational quality standards.

Community and Technical Schools  Tuition is generally less expensive than a college or university.  Can receive an associates degree for two years of study.  Career and Technical schools teach specific skills.  Can transfer credits to a college or university.

Ways to Pay for Formal Education after High School  Loans – unsubsidized and subsidized  Grants  Scholarships  Work Study Programs  Working while in school

Subsidized and Unsubsidized Loans  Subsidized loans are guaranteed by the federal government, has a low-fixed interest rates, and interest does not start until after graduation.  Unsubsidized loans are not guaranteed, have higher interest rates, and interest begins when the loan is granted.  Both types are not repaid until after graduating from college.

Grants and Scholarships  A grant is money given to pay for educational expenses that does not have to be repaid. The federal government gives Pell Grants based on need.  A scholarship is a gift of money or other aid (free tuition) awarded to a student to help pay for education. Scholarships may be available to students with high grades, strong athletic skill, or high test scores.

Work-Study Programs  Work-study is a program where you can work as part of your financial aid package.  Also can find work at the college.

Working and Saving  Advantage – Working an paying as you go reduces your debt and allows you to pay it off along the way. Also gain work experience.  Disadvantage – It takes longer to obtain you degree because you are working.

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Assignments  Due Monday  Answer questions 1-22 on pg. 19  Read lesson 1-3 pg  Due Tuesday (Jan. 13): Go to and print information about three careers. On one of those careers write a short report (less than 1 page) on the types of information found (job title, nature of the work, work environment, training and skills required, and job prospects).